• EUR/USD bounces back from weekly lows, trading at 1.0818 following Jerome Powell’s comments about a potential pause in the Fed’s tightening cycle.
  • Progress in US debt ceiling talks sparks optimism, with House Speaker McCarthy suggesting a deal might be reached over the weekend.
  • In the Eurozone, the Producer Price Index rises month-on-month, while ECB officials express concern over service inflation, advocating for higher rates.

EUR/USD rebounds from its weekly lows after piercing the 100-day EMA, reclaiming the 1.0800 figure following US Federal Reserve Jerome Powell’s remarks, in which he opened the door for a pause on the Federal Reserve tightening cycle. In addition, a risk-on impulse dented an upbeat market sentiment, weighed in the US Dollar. At the time of writing, the EUR/USD is trading at 1.0818 after hitting a low of 1.0759.

Investor optimism grows as US debt ceiling discussions progress, European Central Bank eyes inflation concerns

US equities are registering solid gains. Fed Chair Jerome Powell indicated that inflation currently exceeds the target level and stresses the Fed’s unwavering commitment to guide inflation back towards the 2% target, asserting that “failure would cause greater harm.”. Furthermore, Powell noted the strength of the banking system and suggested that tighter banking credit conditions may prevent a potential rise in rates.

A sparse US economic calendar left investors reflecting on recent data. Strong Retail Sales and Industrial Production sparked demand for the greenback. This, coupled with declining unemployment claims, has prompted investors to reconsider the Federal Reserve’s (Fed) anticipated three rate cuts by the end of the year. As a result, the probability of a rate hike in June has risen from 15% to 40.4% within a week.

Regarding the US debt ceiling discussions, US House Speaker McCarthy and Senate Majority Leader Schumer are preparing to schedule votes in the upcoming days. McCarthy voiced optimism about the current discussions potentially yielding a deal by this weekend, stating, “I can see now where a deal can come together.”

On the Eurozone front, Germany’s Producer Price Index (PPI) jumped 0.3% MoM, above the prior month’s reading of -1.4%. Annually based, the PPI rose by 4.1%, decelerating sharply from March’s 6.7%. The data support European Central Bank (ECB) speakers, which have been crossing newswires.

Earlier in the day, statements from Fed officials made headlines. Fed Williams mentioned that the natural interest rate remains low despite the pandemic. Conversely, Michelle Bowman chose not to provide any comments regarding monetary policy.

On the European Central Bank front, Vice President Luis de Guindos noted that “inflation in services is the most worrying for the ECB,” warranting elevated rates. On Friday, ECB’s President Christine Lagarde added that the central bank must keep “sustainable higher” rates to combat inflation.

EUR/USD Technical Analysis

EUR/USD

Overview
Today last price 1.0821
Today Daily Change 0.0051
Today Daily Change % 0.47
Today daily open 1.077
 
Trends
Daily SMA20 1.0961
Daily SMA50 1.0891
Daily SMA100 1.0807
Daily SMA200 1.0464
 
Levels
Previous Daily High 1.0848
Previous Daily Low 1.0762
Previous Weekly High 1.1054
Previous Weekly Low 1.0848
Previous Monthly High 1.1095
Previous Monthly Low 1.0788
Daily Fibonacci 38.2% 1.0795
Daily Fibonacci 61.8% 1.0815
Daily Pivot Point S1 1.0739
Daily Pivot Point S2 1.0708
Daily Pivot Point S3 1.0654
Daily Pivot Point R1 1.0825
Daily Pivot Point R2 1.0879
Daily Pivot Point R3 1.091

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

AUD/USD faces some selling pressure to near 0.6250 amid trade war threat

AUD/USD faces some selling pressure to near 0.6250 amid trade war threat

The AUD/USD pair attracts some sellers to near 0.6245 during the early Asian session on Monday. The US Dollar edges higher amid the fear of a trade war threat. Trump said on Friday he plans to announce reciprocal tariffs on many countries by Monday or Tuesday, without specifying which countries.

AUD/USD News
USD/JPY climbs back closer to 152.00 amid Trump's tariff threats

USD/JPY climbs back closer to 152.00 amid Trump's tariff threats

USD/JPY kicks off the new week on a positive in reaction to US President Donald Trump's tariff threats. This comes on top of Friday's upbeat US NFP report and and could limit the scope for the Fed to ease policy. However, hawkish BoJ expectations, along with a softer risk tone, might underpin the JPY and cap the pair.

USD/JPY News
Gold extends upside above $2,850 on trade war tensions, China’s buying

Gold extends upside above $2,850 on trade war tensions, China’s buying

Gold price extends the rally to around $2,865 during the early Asian session on Monday. The precious metal edges higher as escalating trade tensions prompt investors to seek refuge in the safe-haven asset. 

Gold News
Week ahead: Will US CPI be a positive distraction amid Trump’s dramas?

Week ahead: Will US CPI be a positive distraction amid Trump’s dramas?

US consumer and producer prices to be main focal point. UK economic output data to be watched too. But Trump and tariff headlines might be a bigger market driver.

Read more
Top Trumps: The global economy’s House of Cards

Top Trumps: The global economy’s House of Cards

The year has barely started and we are learning the hard way what Donald Trump’s second term in office means for markets, analysts and global policymakers. It's like living through an episode of the political thriller, House of Cards.

Read more
The Best Brokers of the Year

The Best Brokers of the Year

SPONSORED Explore top-quality choices worldwide and locally. Compare key features like spreads, leverage, and platforms. Find the right broker for your needs, whether trading CFDs, Forex pairs like EUR/USD, or commodities like Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures

Best Brokers of 2025